Nokian Renkaat Oyj · OMXHEX:TYRES
Nokian Renkaat Oyj — Nokian Tyres — Q4 2020 Earnings Presentation
26 slides from Nokian Renkaat Oyj's earnings presentation, Feb 9, 2021
Slide 1: Good Performance in an Unprecedented Market Environment
GOOD PERFORMANCE IN AN UNPRECEDENTED MARKET ENVIRONMENT Q4 AND FULL-YEAR RESULTS 2020 FEBRUARY 9, 2021 JUKKA MOISIO – CEO TEEMU KANGAS-KÄRKI – CFO
Slide 2: Q4 Impacted by COVID-19 and Delayed Winter
Q4 IMPACTED BY COVID-19 AND DELAYED WINTER • Net sales EUR 413.4 million (474.8), -7.1% with comparable currencies • COVID-19 and delayed winter affected Passenger Car Tyres’ sales • Heavy Tyres and Vianor performed well • Segments operating profit EUR 80.1 million (106.8) • Negative impact from low
Slide 3: Solid End to an Exceptional Year
SOLID END TO AN EXCEPTIONAL YEAR • Strong performance by the Nokian Tyres team • Net sales EUR 1,313.8 million (1,585.4 ), -13.3% with comparable currencies • Negatively impacted by COVID-19, measures taken in Russia, and mild winter 2019–2020 • Segments operating profit EUR 190.2 million (337.2) •
Slide 4: Cash Flow Improved Significantly - Balance Sheet Continues to Be Strong
CASH FLOW IMPROVED SIGNIFICANTLY - BALANCE SHEET CONTINUES TO BE STRONG EUR million 10– 10– CC* CC* 12/20 12/19 Change Change 2020 2019 Change Change Net sales 413.4 474.8 -12.9% -7.1% 1,313.8 1,585.4 -17.1% -13.3% Segments operating profit 80.1 106.8 190.2 337.2 Segments operating profit % 19.4% 22
Slide 5: Q4/2020: Passenger Car Tyres
Q4/2020: PASSENGER CAR TYRES Profitability impacted by lower volumes and currencies 10– 10– CC* CC* 12/20 12/19 Change Change 2020 2019 Change Change Net sales, M€ 262.0 317.3 -17.4% -9.8% 871.3 1,123.8 -22.5% -18.0% Segment operating 66.5 82.2 177.8 308.5 profit, M€ Segment operating 25.4% 25.9% 20
Slide 6: Passenger Car Tyres Net Sales - Quarterly Changes
PASSENGER CAR TYRES NET SALES - QUARTERLY CHANGES YoY Change % Sales Volumes Price/Mix Currency 6
Slide 7: 2020: Passenger Car Tyres Bridge
2020: PASSENGER CAR TYRES BRIDGE Negative impact of EUR 99 million from volume on segment operating profit NET SALES, M€ SEGMENT OPERATING PROFIT, M€
Slide 8: Q4/2020: Heavy Tyres
Q4/2020: HEAVY TYRES Net sales at a good level 10– 10– CC* CC* 12/20 12/19 Change Change 2020 2019 Change Change Net sales, M€ 53.2 54.5 -2.5% 0.9% 194.6 202.7 -4.0% -1.8% Segment operating 5.0 10.1 23.7 35.7 profit, M€ Segment operating 9.5% 18.6% 12.2% 17.6% profit, % * Comparable currencies • Net
Slide 9: Q4/2020: Vianor
Q4/2020: VIANOR Good performance in seasonally important quarter 10– 10– CC* CC* 12/20 12/19 Change Change 2020 2019 Change Change Net sales, M€ 115.4 120.0 -3.9% -2.4% 318.1 336.5 -5.5% -2.8% Segment operating 10.0 14.1** 4.0 7.7** profit, M€ Segment operating 8.7% 11.8% 1.3% 2.3% profit, % Number
Slide 10: 2020 Highlights in Sustainability
2020 HIGHLIGHTS IN SUSTAINABILITY FIGHTING WE WERE THE FIRST SAFETY FIRST CLIMATE CHANGE in the tire industry Our LTIF* dropped to Rolling resistance of to have SBT targets record low: 3.7 our tires on average for reducing CO2 8.5% lower than in (2019: 4.3) emissions approved 2013 IN THE NEW TOP 10%
Slide 11: 2021 We Focus on Growth and Cash Flow
2021 WE FOCUS ON GROWTH AND CASH FLOW
Slide 12: Our Priorities for the Coming Quarters
OUR PRIORITIES FOR THE COMING QUARTERS Growth and cash flow • Driving growth through new product launches and continuous improvements in go-to-market activities • Protecting cash flow by prioritizing investments, capex expected to be lower than 2020 → With a valued brand, strong expertise and enhanc
Slide 13: New Products - Building Our Competitiveness (Passenger Car Tyres)
NEW PRODUCTS - BUILDING OUR COMPETITIVENESS PASSENGER CAR TYRES NOKIAN TYRES NOKIAN NORDMAN 8 & NOKIAN TYRES ONE NOKIAN HAKKA GREEN 3 ENCOMPASS AW01 NOKIAN NORDMAN 8 SUV A versatile all-weather tire One for safety, One for durability, Reliable winter grip for northern The new summer tire designed fo
Slide 14: Nokian Hakkapeliitta 10
NOKIAN HAKKAPELIITTA 10 • Superior winter grip • New studs, oriented studs on shoulder areas • Increased amount of studs • New tread compound • Comfort and reduced noise level • Eco Stud 10 concept • Increased base layer thickness softens stud impact and lowers interior noise • Computer optimized tr
Slide 15: New Products - Building Our Competitiveness (Heavy Tyres)
NEW PRODUCTS - BUILDING OUR COMPETITIVENESS HEAVY TYRES NOKIAN E-Truck NOKIAN GROUND KARE N O K I A N T Y R E S I N T U I T U TM NOKIAN GROUND KING 17.5 & 19.5 SEMI-SLICK Nokian Tyres IntuituTM smart Nokian Ground King tire family Nokian E-Truck tire range for Nokian Ground Kare semi-slick tractor t
Slide 16: Assumptions for 2021
ASSUMPTIONS FOR 2021 • Demand for replacement car tires expected to increase, driven by stronger demand and increasing new car sales • Demand for Nokian Heavy Tyres’ core products estimated to increase • Uncertainties due to COVID-19 pandemic and Russian ruble • Average EUR/RUB: 72.5 in 2019, 82.7 i
Slide 17: Guidance for 2021
GUIDANCE FOR 2021 In 2021, Nokian Tyres’ net sales with comparable currencies and segments operating profit are expected to grow significantly. The global car and tire demand is expected to pick up, but the COVID-19 pandemic continues to cause uncertainties for the development. 17
Slide 18: Peace of Mind in All Conditions
PEACE OF MIND IN ALL CONDITIONS
Slide 19: Appendix
APPENDIX 19
Slide 20: Car and Tire Markets Declined in 2020
APPENDIX CAR AND TIRE MARKETS DECLINED IN 2020 The Nordic countries Russia Europe (excl. the Nordic countries) North America New car sales -14% New car sales -9% New car sales -25% New car sales -15% Car tire sell-in -8% Car tire sell-in -25% Car tire sell-in -12% Car tire sell-in -13% Heavy tire se
Slide 21: Group Segments Operating Profit per Quarter 2016–2020
APPENDIX GROUP SEGMENTS OPERATING PROFIT PER QUARTER 2016–2020* 2020 CUMULATIVE SEGMENTS OPERATING PROFIT PER REVIEW PERIOD 380 330 • Net sales 1,313.8 M€ 280 (1,585.4), -17.1% 230 M€ 180 130 • Segments operating profit 80 190.2 M€ (337.2) 30 -20 1–3 1–6 1–9 1–12 10–12/2020 SEGMENTS OPERATING PROFIT
Slide 22: Q4/2020: Passenger Car Tyres Bridge
APPENDIX Q4/2020: PASSENGER CAR TYRES BRIDGE Negative impact of EUR 19 million from volume on segment operating profit NET SALES, M€ SEGMENT OPERATING PROFIT, M€ 22
Slide 23: Material Cost Development
APPENDIX MATERIAL COST DEVELOPMENT Decreased in 2020 MATERIAL COST DEVELOPMENT INDEX 2010–E2021 140 131 131 MATERIAL COSTS 130 (€/KG) 120 114 • Decreased by 12.7% in 2020 vs. 110 100 2019 100 96 92 92 96 88 90 84 • Decreased by 3.0% in Q4/2020 83 79 80 vs. Q3/2020 70 2010 2011 2012 2013 2014 2015 20
Slide 24: Net Debt and Debt Maturities
APPENDIX NET DEBT AND DEBT MATURITIES 24
Slide 25: Network Development Progressed
APPENDIX NETWORK DEVELOPMENT PROGRESSED NAD Vianor, NAD, N-Tyre; +38 stores in 2020 N-TYRE VIANOR VIANOR – 1,117 SERVICE CENTERS ICELAND IN 17 COUNTRIES 4 174 own stores and 943 partners USA 290 Own -15, partner -38 vs. year-end 2019 NORWAY SWEDEN FINLAND 127 96 103 • Largest tire chain in the Nordi
Slide 26: It's a Beautiful Journey
IT’S A BEAUTIFUL JOURNEY Disclaimer Statements in this presentation, which are not historical facts, such as expectations, anticipations, beliefs and estimates, are forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995. Such statements in